If the geological metaphor fashionable in Washington these days can be applied in Damascus, then Syria is moving perilously closer toward an existential cliff. President Bashar Assad on Sunday delivered a dramatic aria of defiance from the stage of the Damascus Opera House, rallying his base for a fight to the finish against a 21-month-old rebellion he dismissed as an unholy alliance between the West and al-Qaeda. The hour-long speech offered little hope that Assad might be about to end the civil war that has killed upwards of 60,000 Syrians by heeding the rebels’ central demand: that he step down. Indeed, Assad rejected any negotiations with an opposition he branded “enemies of God and puppets of the West.” He would only negotiate, he vowed, “with the master, not the servants” — a signal, perhaps, that his real message was directed at Western and regional powers. Condensed to a tweet, such a message might read: “Aprés moi, le déluge. Accept my terms, or own the consequences of Syria’s breakup — which we all know you’re desperate to avoid.”

Assad did, of course, offer settlement terms, but those were not much different from his previous demands: rebels would cease attacks and outsider powers would stop backing them; state control over border crossings (many now in rebel hands) would be restored, and the regime would convene a “national dialogue conference” with those who reject violence in order to negotiate a new constitution and open the way for a political transition. Unsurprisingly, his terms were summarily rejected by opposition spokesmen who said the regime had offered no meaningful concessions. The U.S. State Department dismissed Assad’s proposals as “detached from reality” and as “yet another attempt to cling to power.” Until now, the opposition has insisted that negotiations are possible only when Assad agrees to go.

“That was not the speech of a man seeking a compromise,” says Syria expert Joshua Landis of the University of Oklahoma. “That was the speech of a man who believes his side can win. He offered no ray of hope that a political solution might be possible but instead sought to rally the troops and remind the West of the stakes.” With neither the opposition nor Assad willing to talk to each other, mediation efforts by U.N. envoy Lakhdar Brahimi, strongly backed by Russia, are going nowhere. “Assad’s speech also challenges the West to rethink its policy, because the war is nowhere near an end,” says Landis. “The rebels are not getting nearly the level of outside support they’d need to destroy the regime’s military. And Assad seems to be warning that Syria itself could be destroyed in the process of bringing down his regime.”

While there’s a common perception in Western capitals that the regime is on its last legs, there are plenty of signs on the ground that it remains very much intact — and very dangerous. Assad’s security forces have been forced to relinquish control of many rural areas and have even ceded the impoverished peripheries of a number of Syrian cities, but the regime has escalated its attacks on areas under rebel control in recent months, deliberately imposing a heavier toll in humanitarian suffering. And rebels in many areas appear desperately short of funds and military resources, despite promises of expanded support from outside powers.

Assad may have also been playing on the West’s ambivalence at the prospect of a rebel military victory by harping on the al-Qaeda theme. Washington last month designated Jabhat al-Nusra, an al-Qaeda-inspired militia at the forefront of rebel fighting forces, as an international terrorist organization — a move that drew howls of protest, even from the leadership of the U.S.-backed Syrian National Coalition.

Assad has survived, as the New York Timesnoted last Friday, because almost two years into the rebellion, “a critical bloc of Syrians remains on the fence,” skeptical of both the regime and of the rebels. Large numbers of Alawite and Christians who detest Assad and his regime remain unwilling to embrace what appears to many of them as a sectarian, Sunni Islamist rebellion. As Slobodan Milosevic had done in Yugoslavia, Assad has created a kill-or-be-killed mind-set among his core constituencies.

That’s not a reality easily altered by the best efforts of Western powers to foster reconciliation plans in distant capitals in the hope that these will convince most of the Alawite and Christian minorities — and even many urban, wealthier Sunnis — that they have nothing to fear from a rebel victory. Those closest to the action are often less convinced of the alternative represented by the armed rebels, even if they’re appalled by the regime’s brutality. Grotesque scenes of Alawite soldiers being tortured to death by rebel captors may not have gotten much international-media air play, but they’ve gone viral on YouTube among the communities that fear for their fate should Assad be toppled.

Fred C. Hof, who until last September was the U.S. State Department’s special adviser for the transition in Syria, wrote last week of the sectarian danger in Syria:

Some regime opponents insist … that the opposition (armed and not) remains overwhelmingly committed to a Syria of citizenship, one permitting no civil distinction among Sunni, Alawite, Christian, Kurd, Ismaili, Turkman, Druze, and so forth. One hopes they are accurate and truthful, and not merely trying to appeal to the sensibilities of Americans who perhaps do not understand how the world really works (at least in Syria). And yet how many members of Syrian minorities — fully one-third of the country’s population — accept these proffered reassurances? Probably no more than a handful do. And why should they? What would weigh heavier on the brain of a non-Sunni Arab (or a Sunni Arab committed to secular governance): the occasional word about the primacy of citizenship, or the televised chanting of hirsute warriors and the exaltation by [Jabhat al-Nusra] in reaction to the fully justified (if ill-timed) U.S. designation of the group as terrorist?

In sum, the Assad regime has hijacked the Alawite community and large components of other minorities, holding them hostage to the survival of rule by clan and clique … If in the end Syria is really akin to Lebanon in terms of the supremacy of sectarian identification, it is finished.

That may be exactly why Assad has chosen to force what began as a peaceful protest movement for democracy onto the terrain of a sectarian civil war. This way, the stakes for millions of Syrians, and for regional stakeholders, are that much higher.

Tony Karon is a senior editor at TIME, where he has covered international conflicts in the Middle East, Asia, and the Balkans since 1997. A native of South Africa, he now resides with his family in Brooklyn, New York.